the automation of intralogistics in australia

THE AUTOMATION OF INTRALOGISTICS IN AUSTRALIA

Contents

The automation of intralogistics in Australia2

Foreword2020 is the year that efficient and scalable intralogistics, which is the optimisation,

integration, automation, and management of the logistical flow of information and

material goods, has been revealed as essential to our way of life.

The pressure on supply chains and increased demand on delivery infrastructure

exposed by COVID-19 is likely to evolve into a more permanent shift in consumer

and commercial behaviours. This once-in-a-lifetime event has only served to

compound the evolution seen through the 2010’s; increasing e-commerce and on-

demand consumer attitudes.

There are few industries that can claim to be as automated as the logistics

and warehousing sector. Konica Minolta’s research indicates that 62 per cent

of respondents will consider implementing autonomous mobile robots; a statistic

that puts the industry in great stead to take advantage of the post-pandemic

business landscape.

It is into this environment that we are pleased to release our inaugural report:

The automation of intralogistics in Australia. In this report you will find what we

believe is the first and only comprehensive report on the trends, priorities, needs

and opportunities in the intralogistics space in Australia.

We hope you find the content within informative and useful.

We believe that there’s never been a better time to innovate and the next decade

brings even greater opportunity for this sector. Those that succeed will be

underpinned by innovation, automation and the normalisation of technology-driven

supply chain solutions.

Martin Keetels

National manager – robotics and innovation


Long dominated by forklifts, conveyors and

automated guided vehicles (AGVs), autonomous

mobile robots (AMRs) are a significant innovation in

the intralogistics sector. AMRs offer efficiency, safety

and cost benefits relative to their predecessors.

The recent pandemic has brought entire sections of

the Australian economy to a halt. Factory closures,

increased demand for critical items and production

suspensions have been experienced, disrupting

global supply chains and leading to shortages of

critical goods and services.

Many organisations have taken significant steps

towards reshoring supply to reduce their exposure

to offshore vulnerabilities. Business continuity will

become a key requirement in any future intralogistics

solution scoped and acquired. It is envisioned that

COVID-19 will be the impetus for rapid growth in AMR

adoption in the Australian market.

This report examines the intralogistics industry in

Australia. It has a particular focus on the impact

that the implementation of AMRs will have on the

Australian market through analysing survey data

recorded after the COVID-19 outbreak, providing

insights from senior executives, managers and

intralogistics workers.

Three key areas of priority have emerged

from this research: safety, productivity and

customer satisfaction.

Introduction


Australian intralogistics industry post COVID-19As we began our research into the

intralogistics landscape in Australia the

global pandemic hit. This unprecedented

occurrence has changed the course

of business globally and our research

has straddled the beginning and

middle of COVID-19. According to

Roy Morgan, almost 60 per cent of

Australian businesses have been affected

negatively by the COVID-19 outbreak,

with hospitality and retail sectors bearing

the brunt.1

However, supply chain and logistics

workers have been classified as key

workers demonstrating what a pivotal

role the industry plays in keeping

Australia going. Our research indicates

that intralogistics will be a focus for

businesses in the coming months,

towards Australia’s recovery from the

economic downturn.

Our respondents indicated that

intralogistics automation is still a primary

consideration despite the impact, with

59 per cent of warehousing and logistics

organisations considering implementing

AMR’s pre-pandemic and 64 per cent

1 http://www.roymorgan.com/findings/8328-impact-of-coronavirus-march-2020-202003160441

of the same respondents rethinking

automation in their warehousing due to

the pandemic.

The imperative to drive productivity and

efficiency has only been heightened in

the pandemic environment: 20 per cent

of those surveyed said they are certain

that they will make investments in new

technology in the coming 12 months.

COVID-19 has also driven the need for

contactless technology in workplaces

across Australia. Intralogistics relies

heavily on human proximity and as a new

health and safety consideration, social

distancing is a top priority in business.

Collaborative robotics, like AMRs, can

reduce peer-to-peer contact.

While Australia is still facing an

unprecedented and unpredictable

business environment, warehousing

and logistics will form the backbone

which Australia will rely on through

this challenging time.

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WHAT IS IMPORTANT TO YOU WHEN IMPLEMENTING AMR's?

AMR solutions increase the efficiency of operations, automating up to 46 per cent of routine tasks, freeing up

staff to focus on more valuable projects.


Manual handling injuries in the

workplace cost Australia $28 billion per

year1 as many intralogistics workers

carry out tasks that involve driving

forklifts, lifting, carrying, pushing and

pulling throughout the day.

In 2017-18, the most common

mechanism of injury that resulted in

serious claims were body stressing

(36%), falls, trips and slips of a person

(23%) and being hit by moving

objects 16%.2

Based on Australian Bureau of Statistics

data (ABS 2020), labourers and

machinery operators are by far the most

impacted groups of workers. 3

1 https://www.peoplesense.com.au/news/article/27062018-240/manual-handling-injuries-in-the-workplace-cost-australia-28b-per-year

2 https://www.safeworkaustralia.gov.au/system/files/documents/2001/australian-workers-compensation-statis-tics-2017-18_1.pdf

3 https://www.abs.gov.au/ausstats/[email protected]/Lookup/BE46FE1E08544041CA2584A8000E788E?opendocument

Removing the need for human intervention

in transporting goods around warehouses

is a key driver in reducing the health and

safety risks, and improving safety records.

AMRs are uniquely placed to remove two

types of workplace risks: body stressing

associated with pushing, pulling and lifting

and the risk of being hit by a moving object.

AMRs’ prime function in intralogistics

environments is to move objects. They

significantly lessen the risk of common

body stressing injuries. Furthermore, they

reduce the risks of being hit by moving

objects such as forklifts. This is because

AMRs come with a suite of highly advanced

safety technology to minimise human risk

associated with forklift accidents.

Major group No. of serious claimsProportion of serious claims

Incidence rate

Labourers 27,140 25% 24.1

Machinery operators and drivers

15,280 14% 20.3

Safety: continuing and enhancing best practice

There is an average of

15,280 serious claims in

Australia for machinery operators

and 6.6 weeks average

time lost to serious injury.4

4 www.safeworkaustralia.gov.au/system/files/documents/2001/australian-workers-compen-sation-statistics-2017-18_1.pdf


Productivity: driving the next level of a productive workforce

As pressure and demand on the

Australian logistics sector increases,

many businesses find themselves dealing

with shrinking margins and changing

regulations. For this reason, productivity

is vital for survival.

It is estimated that 25–46 per cent of

current work activities in Australia could

be automated over the next 10 years.1

Demand for technology skills, higher

cognitive skills, social skills and emotional

skills will increase further, while the

1 https://www.mckinsey.com/featured-insights/future-of-work/australias-automation-opportunity-reigniting-productivity-and-inclusive-income-growth#2 https://www.robotics.org/content-detail.cfm/Industrial-Robotics-Industry-Insights/Autonomous-Mobile-Robots-Push-Robot-Boundaries/content_id/80993 https://www.mobile-industrial-robots.com/en/insights/report/

need for people to perform physical and

routine tasks is forecast to decline.

Due to the rise of online shopping

and changing consumer behaviours,

companies have tremendous

growth opportunities and those

who have deployed AMRs have

seen benefits through significant

productivity improvements. According

to the Robotics Industry Association,

more than 70 per cent of users noted

double-digit key performance indicator

(KPI) improvements from increased

capacity, productivity, efficiency,

operational speed, customer service,

inventory turnover and reduced

operating costs.2

The adoption of automation

technologies, including AMRs, is an

avenue to increase competitiveness

in a volatile business environment.

Currently, 85 per cent of Australian

business leaders find keeping pace with

changing market demands challenging.3

Through automation warehouse and

logistics organisations can alleviate

the pressure to meet these changing

demands by ensuring they have a flexible,

scalable, and productivity-increasing

solution in place.

70 per cent of logistics and

operations managers say

increasing productivity is their top

priority in 2020.


The expectations of customers,

consumers and businesses have evolved

over the past decade, and it is envisioned

this trend will continue. With next day

and same day delivery becoming the

expectation, customer satisfaction has

become a key differentiator for logistics

operators. Those who can deliver faster,

and more accurately are set to prosper.

The gap between warehouse and

customer is shrinking year by year as

these demands become the norm in

customer expectations.

A more automated warehouse reduces

human errors and improves reaction

and despatch time, leading to greater

customer satisfaction.

Improving customer experience

55.6 per cent of senior executives surveyed said customer experience

was their number one priority

8 The automation of intralogistics in Australia

CASE STUDY

InfinitusInfinitus, a leading manufacturer of traditional Chinese herbal supplements,

adopted cutting-edge AMR technology. It has seen impressive production results

since the implementation of three MiR robots in its production plant.

The challenge

Reliance on human labour to transport

materials was limiting productivity.

Infinitus knew it had to automate to

stay competitive. It initially wanted to

install AGVs, but that quickly halted

due to the length of time required to

lay guidance tracks.

Outcome:

Since implementing the MiR robots,

Infinitus has significantly reduced the

need for manual labour, freeing up

personnel for more advanced technical

work such as material inspection. This

let Infinitus use talent more effectively

and empowered its personnel to engage

in work that creates more value. In

addition, production levels rocketed.


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US$300 Million US$3 Billion

An increasing demand for autonomous

automation is driving productivity

and efficiency changes in Australian

warehouses. Our research highlighted

that within the next two years 50 per

cent of those surveyed are looking to

implement AMR technology.

70 per cent of those working in the

warehouse and logistics sector believe

increasing productivity is their priority in

2020 and 60 per cent confirm there is a

dedicated budget for implementing AMRs

in their organisations this year.

Globally the market trend is shifting towards

the development of AMRs. According to

Interact Analysis, the AMR market is set to

grow 10-fold from $300 million in 2017 to $3

billion by 2022 on a global scale (2018).

This all supports a significant shift in how

the future warehouse will look, and less

reliance on AGV’s with 50 per cent of

respondents considering implementing

AMRs versus 33 per cent considering AGVs.

This gradual evolution from forklifts and

AGV to AMR is set to continue through the

next five years.

With almost half of senior executives

surveyed actively rethinking automation

to cope with future challenges instead

of merely reacting to global disruptions,

companies are investing in automation

technologies in order to achieve a

competitive edge and future-proof

their business.

The logistics and warehousing

landscape is set to look very different

in the coming decade with AMRs and

humans working collaboratively in a

warehouse environment.

The future warehouse in Australia

43.8 per cent of respondents are currently using AMRs. In the next two years, 50 per cent of respondents are

considering implementing AMRs.

MARKET SIZE IN BILLIONS (USD)

GLOBAL AMR GROWTH (USD)


Konica Minolta Business Solutions

Australia (Konica Minolta) is an integrated

innovation and technology company.

Tracing its origins back to 1873, Konica

Minolta has supported the communities

in which it has operated through three

separate centuries. Today, Konica Minolta

provides a range of services to the

Australian market including managed

print services, industrial print, production

print, document management, 3D

Printing and autonomous mobile robots

(autonomous mobile robots).

Konica Minolta is proudly a “company that

cares”. Its contribution to Australian society

was recognised in 2018 when it won the

Australian Human Rights Commission’s

Human Rights Award for Business for

“human-centred policies” including

ridding its supply chain of slavery and

promoting human rights and equality.

Konica Minolta began its association

with Mobile Industrial Robots (MiR) of

Denmark in 2016. It is a partner and

distributor of Mobile Industrial Robots

(MiR) in Singapore, Hong Kong, Malaysia

and Australian markets. Over the past

five years, the Konica Minolta robotics

team has leveraged its international

experience deploying autonomous

mobile robots to the benefit of its

customer base.

About Konica Minolta AustraliaKey findings

GLOBAL AMR MARKET IS SETTO GROW EXPONENTIALLY TO

US$3 BILLION BY 2022

AMR IS A NEW BLUE OCEAN IN AUSTRALIA.MANY GLOBAL PLAYERS ARE PRIMEDTO ENTER THE AUSTRALIAN MARKET.

MANUAL HANDLING INJURIES INTHE WORKPLACE COST AUSTRALIA

$28 BILLION PER YEAR

THE MARKET IS TRANSITIONINGFROM AGVs TO AMRs IN AUSTRALIA

AND GLOBALLY

OF SENIOR EXECUTIVES RANKED DRIVINGEFFICIENCY AS NUMBER ONE PRIORITY

IN 2020, FOLLOWED BY IMPROVINGCUSTOMER EXPERIENCE (55.6%)

AND COST SAVINGS (44.4%).

ALMOST HALF OF SENIOREXECUTIVES ARE RETHINKINGAUTOMATION AS A PRIORITY

IN WORKPLACESDUE TO COVID-19

TOP 3 CONSIDERATIONSFOR IMPLEMENTING AMRsIN THE WORKPLACE ARE:

1. SAFETY 2. PRODUCTIVITY3. EFFICIENCY

TOP 3 SECTORS INAUSTRALIA WITH BIGGEST

POTENTIAL TO ADOPT AMRs ARE:1. LOGISTICS & WAREHOUSING2. MANUFACTURING 3. RETAIL

66.7%

US$3B

AUTONOMOUS MOBILE ROBOTS


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